ILNews

Opinion regarding insurance company considers definition of ‘ever’

Back to TopCommentsE-mailPrintBookmark and Share

An Indiana Court of Appeals panel was split in an opinion released today that considered the definition of “ever” on a home insurance application when it came to whether the homeowners insurance coverage was ever “declined, cancelled, or non-renewed.”

While the majority opinion found that “ever” should include all insurers who may have cancelled the plaintiffs’ coverage, a dissenting judge wrote that in this case, “ever” should have only included the cancellations by the defendant insurance company.

In Allied Property and Casualty Insurance Company v. Linda Good and Randall Good, No. 85A04-0905-CV-240, Linda and Randall Good had a fire March 16, 2003, that destroyed their home and all of its contents.

Only Linda’s name was on the policy she had with the insurance company. The policy was to last one year, beginning July 2, 2002. The insurance company had neither denied nor paid their claims regarding the fire pending an ongoing investigation concerning the fire’s cause. Linda sued March 9, 2004, for breach of contract based on the non-payment of the claim.

Two trials took place. The first trial was in December 2008, which ended in a mistrial. The second trial in January 2009 was bifurcated to address Linda’s breach of contract claim, to address Allied’s third-party claims against Randall that he made false statements about the fire, and to address Allied’s counterclaims against Linda.

Among Allied’s counterclaims were that Linda misrepresented her insurance cancellation history on the application. If the insurance company had known her true cancellation history, Allied claimed, the company would have either denied her coverage or required a higher premium for the coverage.

After hearing the evidence in the January 2009 trial, the court entered a directed verdict for the Goods. The jury awarded slightly more than $1 million in damages to Linda.

However, the Court of Appeals disagreed with the trial court, finding that because Linda acknowledged that at least one and possibly three insurance companies had cancelled policies held by Linda and Randall, she had indeed misrepresented her cancellation history on the application when she claimed she was never denied coverage.

Linda claimed that because the way the form was worded, she interpreted it to mean whether she was ever denied coverage by Allied, and therefore didn’t include her cancellations from other insurance companies.

The Court of Appeals found that this misrepresentation was material in this case.

“A misrepresentation on an application for an insurance policy is ‘material’ if the fact misrepresented, had it been known to the insurer, would have reasonably entered into and influenced the insurer‘s decision whether to issue a policy or to charge a higher premium,” wrote Judge Melissa S. May for the majority.

However, in a footnote the court clarified this definition by adding, “Our opinion … should not, and cannot, be read to encourage, or even permit, parties to comb through insurance applications in hopes of finding any false statement in an effort to reduce premiums or avoid paying benefits. Only a ‘material’ false representation could permit either result.”

Because of these findings, Judge May wrote, “the trial court erred by denying Allied’s motion for summary judgment. We reverse and remand for entry of judgment for Allied on all counts.”

However, while Judge Michael P. Barnes concurred, Judge L. Mark Bailey wrote a 9-page dissent.

Including an image of the application field in question, he wrote the application field about past insurance cancellations was unclear as to whether “ever” included all insurance companies or just Allied.

“Taking ‘ever’ out of its context seems to me to disregard how a reasonable person could construe the question,” he wrote. “Reading the form as presented above, a reasonable person could indeed interpret the item about prior cancellations as pertaining to the current insurer – particularly since the section heading is ‘INSURANCE COVERAGE,’ not ‘Prior Insurance Coverage,’ ‘Coverage History,’ or the like.”
 

ADVERTISEMENT

Post a comment to this story

COMMENTS POLICY
We reserve the right to remove any post that we feel is obscene, profane, vulgar, racist, sexually explicit, abusive, or hateful.
 
You are legally responsible for what you post and your anonymity is not guaranteed.
 
Posts that insult, defame, threaten, harass or abuse other readers or people mentioned in Indiana Lawyer editorial content are also subject to removal. Please respect the privacy of individuals and refrain from posting personal information.
 
No solicitations, spamming or advertisements are allowed. Readers may post links to other informational websites that are relevant to the topic at hand, but please do not link to objectionable material.
 
We may remove messages that are unrelated to the topic, encourage illegal activity, use all capital letters or are unreadable.
 

Messages that are flagged by readers as objectionable will be reviewed and may or may not be removed. Please do not flag a post simply because you disagree with it.

Sponsored by
ADVERTISEMENT
Subscribe to Indiana Lawyer
  1. Just an aside, but regardless of the outcome, I 'm proud of Judge William Hughes. He was the original magistrate on the Home place issue. He ruled for Home Place, and was primaried by Brainard for it. Their tool Poindexter failed to unseat Hughes, who won support for his honesty and courage throughout the county, and he was reelected Judge of Hamilton County's Superior Court. You can still stand for something and survive. Thanks, Judge Hughes!

  2. CCHP's real accomplishment is the 2015 law signed by Gov Pence that basically outlaws any annexation that is forced where a 65% majority of landowners in the affected area disagree. Regardless of whether HP wins or loses, the citizens of Indiana will not have another fiasco like this. The law Gov Pence signed is a direct result of this malgovernance.

  3. I gave tempparry guardship to a friend of my granddaughter in 2012. I went to prison. I had custody. My daughter went to prison to. We are out. My daughter gave me custody but can get her back. She was not order to give me custody . but now we want granddaughter back from friend. She's 14 now. What rights do we have

  4. This sure is not what most who value good governance consider the Rule of Law to entail: "In a letter dated March 2, which Brizzi forwarded to IBJ, the commission dismissed the grievance “on grounds that there is not reasonable cause to believe that you are guilty of misconduct.”" Yet two month later reasonable cause does exist? (Or is the commission forging ahead, the need for reasonable belief be damned? -- A seeming violation of the Rules of Profession Ethics on the part of the commission) Could the rule of law theory cause one to believe that an explanation is in order? Could it be that Hoosier attorneys live under Imperial Law (which is also a t-word that rhymes with infamy) in which the Platonic guardians can do no wrong and never owe the plebeian class any explanation for their powerful actions. (Might makes it right?) Could this be a case of politics directing the commission, as celebrated IU Mauer Professor (the late) Patrick Baude warned was happening 20 years ago in his controversial (whisteblowing) ethics lecture on a quite similar topic: http://www.repository.law.indiana.edu/cgi/viewcontent.cgi?article=1498&context=ilj

  5. I have a case presently pending cert review before the SCOTUS that reveals just how Indiana regulates the bar. I have been denied licensure for life for holding the wrong views and questioning the grand inquisitors as to their duties as to state and federal constitutional due process. True story: https://www.scribd.com/doc/299040839/2016Petitionforcert-to-SCOTUS Shorter, Amici brief serving to frame issue as misuse of govt licensure: https://www.scribd.com/doc/312841269/Thomas-More-Society-Amicus-Brown-v-Ind-Bd-of-Law-Examiners

ADVERTISEMENT